LAHORE: The energy meters, which the Multan Electric Power Company (Mepco) has bought for Rs42,700 apiece, are being purchased by National Transmission and Dispatch Company (NTDC) at a whopping price of Rs543,756 per meter – a price differential of close to unbelievable 1,300 per cent for the same product.

The NTDC purchase (C/EMP&M/DP/NOR-36/L-I/1073-82, dated 06-08-15) mention meter’s price Rs271,878 per piece and another Rs271,878 for data communication equipment – totaling cost at Rs543,756 per meter.

On the other hand, the Mepco purchase order (061272/Proc/PMU-28, dated 13-08-15) mentions price of Rs42,700 and the manufacturer has offered the data communication equipment for free. Both purchase orders mention same technical specification (P202-2012, with accuracy class of 0.2) for meters.

In response to a question, the NTDC insisted that the meters it was purchasing were different, but refused to explain the difference between both purchases. It also did not want to divulge as to how the same technical specifications could result in different products – especially with a massive price differential. Despite repeated attempts, the NTDC did not explain both issues but kept insisting its meters were different and costlier to those of Mepco.

Company buys a meter at Rs543,756, Mepco procures same gadget at Rs42,700

According to the insiders, the problem is not restricted to this purchase alone. The NTDC has been doing exactly the same since 2006. For the last one decade, it has been purchasing meters from the same manufacturer at exorbitant prices, as proved by the both purchase orders. Though the NTDC claims that it has been buying energy meters (used at grid station for electricity reading) through international competitive bidding (ICB), no other manufacturer has been allowed to compete – however cheap they may be.

All other manufacturers have been disqualified on one pretext or another. Even in this case, there was only one bidder (because others now feel disheartened to the extent of not even applying) and the NTDC went for purchase despite the Public Procurement Regulatory Authority (PPRA) rules prohibiting purchase from a single bidder.

To another query, the NTDC accepted there was only one bidder in the current bid, but maintained it did not violate any PPRA rules.

“This manufacturer’s monopoly, which the NTDC has created and sustained for a decade, has come at very cost to the nation,” explains an official of the Material Procurement and Management (MP&M) section of the NTDC, which has been purchasing these meters. The total loss, when and if calculated, could run into billions of rupees. This purchase order, which was only for 60 meters, has cost the nation Rs30 million extra, if the Mepco purchase order is taken as a benchmark. The monopoly is sustained through multiple and usual tactics; at first stage, all other manufacturers are disqualified for one reason or another and then inspection of these meters is either waived or relaxed or assigned to “appropriate individuals” within the NTDC to protect the manufacturer.

To make the matter even worse, the procurement committee of the board of directors, which was supposed to monitor the corporatised NTDC, has been validating purchase from a single manufacturer for the last three years of its life instead of investigating the matter, he claimed and added: “It only goes to show how rigged the process has become and how powerful stakeholders of the process are. The cost of the meters, even for this single supplier, has multiplied at brisk pace.”

About price of the meter, the NTDC says it increased by 14.7pc between 2006 and 2015 and came down.

Published in Dawn, May 9th, 2016